The island of Sumba, has some 35% of its population living below the poverty line. With 66% of the population involved in agriculture, the people struggle to earn sufficient income to provide for health and education. Around 4,000 potential entrepreneurs could operate viable businesses but have inadequate access to financial services. These people cannot go to banks as it requires provision of collateral. To go to money lenders that have high interest rates creates dependency not capacity.
Building on the success of the branch in Betun, TLM and UnitingWorld will establish a new branch office in Waingapu, the capital city of East Sumba. This branch will become a centre to deliver low interest microloans, as well as training for poor micro entrepreneurs so that they can establish successful small businesses to provide sustainable support for their families and children.
In Betun, where we have worked since 2006, the impact has been significant. By December 2010, there were 1,928 active loan clients. Some 7,589 family members have been able to move off the poverty line. Parents are now able to provide for the education of their children and make provision for health care. But economically the capacity of the region and sense of entrepreneurship and hope for the future is clear. The same can happen in Sumba with the extension of the program.